The Audacity of Hope

Our President has been criticized in recent days for being too gloomy about the future and not inspiring hope and generally improving our morale. Well, last night he tried to lift our spirits and tap into the indomitable human character in America.

He promised to fix nearly everything that needs fixing, all the BIG stuff like health care, energy independence, the banking system, credit woes, the home mortgage crisis, education reform, and on and on. He even promised to cut the deficit in half by 2012.

"In his first formal address to Congress, President Obama sought to ease Americans' growing anxiety about the global downturn and refocus attention on the country's historic sources of strength -- its ideas and innovative spirit.

"While our economy may be weakened and our confidence shaken; though we are living through difficult and uncertain times, tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before," Mr. Obama said." (quote from WSJ)

Yet, the realist in me suggests that he cannot deliver on all this even with a Democrat Congress. Congress, whether in Republican or Democrat control, has shown itself incapable of spending discipline. They inspire no confidence in me, despite the President's mighty words and the fifty-odd rounds of applause.

The President said nothing about reducing the national debt, except as shrinking the annual deficit spending will keep the debt from growing as much as it otherwise would have. Meanwhile $ trillions in expenditures are facing us with war, defense and bailouts. And, 95% of people making under $200,000 won't see any tax increases; most will see a tax cut. Sorry, it doesn't add up.

Americans will continue to feast at the public trough via programs that continue to grow out of control....think Medicaid, Medicare, Social Security as we age.

This just in(2/25/09 5:00 pm before my comments below) from the WSJ: "Obama will propose $634 billion in tax increases on upper-income taxpayers and cuts to government health spending to fund health reform over 10 years, a senior administration official said Wednesday. The proposed tax change would limit the deductions available to people in the highest income tax brackets.

The spending cuts are aimed not just at raising money for the new program, which aims to get health coverage to all Americans, but also at curbing health-care spending overall. The cuts would affect a range of interests, including managed care companies, prescription drug manufacturers and hospitals."

We have only two fundamental options to shrink the out-of-control growth of health care costs: 1./squeezing efficiencies from the system (e.g., electronic health care records, reduce 'just-in-case' procedures and tests,' etc.); and 2./rationing care. People may be willing to deal with 1./, but not 2./, where the really big bucks are. In any event, the only certain result of controlling health care costs is reducing the number of people in that industry, recently one of the fastest growing employment sectors.